“Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.
Today’s column is written by Tim Mayer, chief marketing officer at Trueffect.
Some of the largest companies on the Internet are working on ad IDs and complex identity-management solutions, both of which aim to serve as alternatives or replacements for the third-party cookie.
This is because the third-party cookie and associated ecosystem are facing major challenges. First, third-party cookies can be deleted by users, are cleared by security software programs on average every seven days and are blocked completely by many browsers and devices.
Users are also now accessing the Internet with multiple devices, resulting in cookie proliferation to the point where they know some of those individual cookies are actually the same user, but which ones? It’s also important to note that cookie deletion and churn is reducing the ability of advertisers to target users.
Ad ID and ID management attempts to solve these issues by providing a comprehensive view of the user. What do we have to look forward to in terms of new business metrics, segments and optimizations?
Segment By Scarcity
The Internet population is distributed between heavy and casual Internet users. The more casual Internet users are a lot harder for marketers to reach than those who are online more frequently. Few people take this into account in their bidding strategy. A reliable 360-degree profile is essential to distinguish between these two segments. Marketers should build segments around casual users and bid significantly higher for them than heavy users because they appear much less often.
Segmenting By Type Of Shopper
Shoppers on the Internet exhibit different behaviors in the way they shop. Users should be analyzed to understand their behavior and segmented to target them with an ad at the right time and with the right creative. Raj De Datta of Bloomreach provides a good example of shopper segmentation where he identifies four types of shoppers: Window shoppers are browsers, hunters are searchers, gardeners are brand loyalists and gatherers are deal seekers.
Segmenting users with these types of behavioral profile enables the advertiser to improve critical metrics by executing improvements in targeting. For example, the advertiser can target deals and offers to the gatherers.This ensures that they are enticing these prospects to purchase and withholding these lower margin offers from the other segments, such as gardeners, who will buy from the brands with whom they are affiliated without the added incentive. This execution will increase margins and average order value for the vendor.
Advertisers could also suppress prospecting to the gardener segment. Gardeners are deeply engaged with their favorite brands. If you have not seen one of these users on your site, you may consider not prospecting to them. Once they visit, you then have the opportunity to heavily promote new products and services to them.
Segment By Behavior On Each Device Type
Ad ID allows marketers to segment users by activity on each device type and serve ads for that user at the appropriate stage of the funnel. A 360-profile offers insights into where a user is more likely to buy and allows us to reserve bottom-of-the-funnel creative offers to the user on the appropriate device type. For instance, if a user typically browses on their tablet or phone but always purchases on their desktop, we are able to target ads for the appropriate funnel stage on each device.
Ad ID: Changing Digital Marketing
With the dawn of ad ID from large vendors, such as Google, Facebook and Apple, as well as sophisticated ID management solutions from other ad tech vendors, advertisers will be able to view a 360-degree profile of their prospects and customers and optimize and target users appropriately. This will push advertisers to move beyond the traditional metrics, such as reach and frequency, and force them to look at prospects and customers as users with definitive behaviors.
This approach will not only lead to new efficiencies in the way we as marketers define our advertising but also lead to an improved interaction between users and the advertisements with whom they engage.